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FX – The week ahead, Monday 25 April

FX week aheadMacro observations

  • It’s central bank week!
  • This wednesday we’ve got the BoJ meeting with selling pressure likely on the Yen in the run up. Traders will be extectant of further QE. This could therefore be set to strengthen the USD.
  • US Fed speculation is now more puzzlement. No rate hike is expected to come out of the Fed meeting on Tue/Wed, but of course markets will hone in on the rhetoric for indications as to future actions. USD weakness of late could therefore be set to reverse course.
  • All above said, note last time the BoJ expanded QE, the Yen strengthened instead of weakening, defying logic!
  • Similar things seen with the ECB of late…

Key data this week (Sign up here to get our daily live macro-calendar)

** Note Chinese Manufacturing PMI on Sat 30 Apr.

UK

  • Mon: CBI Trends
  • Tue: BBA Loans for House Purchases
  • Wed: GDP
  • Thur: –
  • Fri: Nationwide House Prices; Consumer Credit

US

  • Mon: New home sales
  • Tue: Durable Goods Orders; Consumer Confidence
  • Wed: MBA Mortgage Applications; Pending Home Sales; FOMC (US central bank) Rate Decision
  • Thur: Jbless Claims; GDP; Consumption
  • Fri: Personal Income & Spending; UoM Confidence; Baker Hughes Rig Count

EU (data for Eurozone unless otherwise stated)

  • Mon: IFO (GER)
  • Tue: –
  • Wed: GFK Consumer Confidence (GER)
  • Thur: Retail Sales, Unemployment Rate, CPI (GER)
  • Fri: CPI

GBP/USD (‘Cable’)

GBP/USD (daily)

GBPUSD daily (-)

 

GBP/USD (hourly)

GBPUSD 30min (-)

Technicals (based on daily price data unless otherwise stated)

  • RSI coming back from long term resistance level around 61
  • Resistance met around 1.447
  • Pullback towards 1.425 would be consistent with near term bullish outlook for the USD

GBP/EUR

GBP/EUR (daily)   

GBPEUR daily (-)

GBP/EUR (hourly)

GBPEUR 15min (-)

Technicals (based on daily price data unless otherwise stated)

  • Profit taking following a strong break above the 50-day MA
  • RSI testing the April uptrend
  • Late April rising support a target for bears this week

EUR/USD

EUR/USD (daily)

EURUSD daily (-)

EUR/USD (30-min)

EURUSD 15min (-)

Technicals (based on daily price data unless otherwise stated)

  • Potential for consolidation ahead of another leg down this week (see 30-min chart)
  • EUR/USD trading just off the ceiling of a 12-month sideways range
  • Stochastics plateaued at overbought
  • Momentum & RSI turned down from bullish extremes
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